Trading
with the SureFireThing Camarilla Equation

Trading
with the SureFireThing Camarilla Equation is discretionary - although
the main 'philosophy' of the system seems mechanical, a reasonable
amount of experience and knowledge is needed to trade the equation
well. Basically, you give the Equation yesterday's open, high, low
and close. The Camarilla Equation will then give you 8 levels of
intraday support and resistance. There are 4 of these 'L' levels
above yesterday's close, and 4 below. Below the close they are numbered
L1, L2, L3 and L4, and above the close H1, H2, H3 and H4. The important
levels to note are the 'H3' and 'L3' levels, points where significant
reversals are likely, and the 'H4' and 'L4' levels which are where
breakouts have a tendency to start. How you specifically enter a
trade depends to some extent where the market opens.

Market
Open BETWEEN 'H3' and 'L3'

If
the market opens BETWEEN the H3 and L3 levels, you must wait for
price to approach either of these two levels. Whichever level it
hits first gives you your first trade.

If
the H3 level is hit, the idea is that you go SHORT (against the
previous trend) in the expectation that the market is about to reverse,
with a stoploss point somewhere between the H3 and H4 levels (if
it his H4, chances are it's going to breakout bigtime upwards, so
you want your stop to be before that!).

SureFireThing,
suggest that you wait for price to bounce back down into the H3
level again before entering the trade, as you will therefore be
technically trading WITH the short term trend. You need afair amount
of experience for this style of trading. The opposite, of course
applies if the LOWER L3 level is hit first - wait for it to come
back up, then go LONG.

Market
Open OUTSIDE 'L3' and 'H3'

In
this case, you wait for the market to retreat back thru the L3 or
H3 level - you will then be trading WITH the trend, and once again,
put a stop loss somewhere before the matching H4 or L4 level. Taking
profits is down to you - trailing stops seem popular. You need to
be aware that you WILL want to take profits at some time during
the day, because the market is unlikely to 'behave' and stay right-sided
for your trade. These reversals from H3 and L3 appear to happen
fairly frequently during intraday trading.